Evolution of dishonest behavior in public procurement: the role of updating control

The audit level plays a crucial role in the prevalence of illegality in public procurement, specifically focusing on fraud. The aim of this paper is to investigate whether a forward-looking mechanism for updating the monitoring level by the State may influence the dishonest behavior in the economy and in which measure it depends on the spread of society’s inherent honesty. With this aim in mind, we describe a model in which the monitoring level put in place by the State to fight non-compliant behavior depends on both the variation of the spread of dishonesty in the economy and on the previous auditing level, while considering economies at different levels of honesty propensities, i.e., greater inherent honesty stems from the stronger social disapproval of dishonesty. By combining analytical tools and numerical experiments, our model describes how the evolutionary adaptation process determines whether compliant or non-compliant behavior prevails in society. The main findings consist of: (1) a slight change in the monitoring function can influence significantly the asymptotic dynamics of the final map; (2) the effectiveness of public policies to combat illegality in public procurement depends on the spread of society’s inherent honesty; (3) complex qualitative dynamics associated, in particular, with border collision bifurcations may emerge.